WASHINGTON – Saddam Hussein personally approved the distribution of oil vouchers to raise funds for the purchase of weapons material, the final report of the American team of weapons inspectors in Iraq will say this week.

According to internal talking points drafted by the National Security Council and obtained by The New York Sun, chief weapons inspector Charles Duelfer has concluded that the Iraqi dictator used a U.N. sanctions program that was aimed at curbing his desire for weapons of mass destruction to buy off countries and individuals to help Iraq weaken the sanctions.

“The report shows U.N. sanctions eroding and increasingly ineffective. Saddam Hussein intended to reconstitute the weapons of mass destruction programs once they were eliminated. The Iraqi ministry of oil with the personal approval of Saddam Hussein used a secret oil voucher distribution system to attempt to influence other nations and individuals to support Iraq’s goals,” the talking points say.

At the same time, Mr. Duelfer concludes that Iraq had significantly dismantled its nuclear program and was not producing chemical weapons at the time the American-led coalition launched the campaign in March 2003 to oust him from power. The report, however, says that Saddam preserved the intellectual capital of his old nuclear program and was only six months away from producing mustard gas.

The report, which is due to be released tomorrow, will be officially leaked to the press today through a background briefing with senior CIA officials, the Sun has learned.

The report from Mr. Duelfer, who replaced David Kay earlier this year when he resigned and promptly told the public that Iraq had no WMD, confirms the former weapons inspector’s initial findings. At the time, the Bush administration took great pains to stress to the press that the hunt for WMD was still on going and Mr. Kay’s conclusions were preliminary.

Mr. Duelfer’s report essentially confirms America’s charge that Saddam was not in compliance with the U.N. resolutions requiring that he disarm, according to the talking points.

“At the start of operation Iraqi Freedom, Saddam Hussein had the capacity to produce sulfur mustard within six months and the capability to produce nerve agents in significant quantities within two years,” the talking points say. It also says that his development of long-range missiles, banned under the 17 sanctions resolutions passed against Iraq between 1991 and 2003, continued unabated.

The new Iraq WMD report could also advance investigations in the House, Senate, and United Nations into the oil-for-food program. The final document is based on countless interviews with Iraqi weapons scientists and documents the Iraq Security Group has yet to share with other bodies conducting probes into the program.

Appearing before the House Government Affairs Committee today are: executives from the bank that oversaw the oil-for-food program; the consulting firm charged with verifying the delivery of goods into Iraq procured from Iraqi oil revenues; and the company hired to verify the oil shipments out of Iraq were consistent with declarations from Saddam’s government.

The hearings will mark the first time executives from BNP Paribas, Cotecna, and Saybolt International will appear before Congress. Appearing before the committee are BNP Paribas’s director of corporate banking operations, David Smith; the managing director of Saybolt International, Peter Boks; and a senior vice president of Cotecna, Andre Pruniaux.

An October 1 staff memo to members of the House committee says that Saybolt and Cotecna effectively lacked authority to verify Iraqi imports under the program and Iraqi petroleum exports. It further chastises the U.N. program for lacking transparency on the deals between the bank and the United Nations.

One staff member with the committee told the Sun yesterday that the panel plans to release to the public numerous documents the staff has collected in its investigation. One such document will be an internal United Nations audit from 2002 that shows “the U.N. had no way to verify that the contractor was doing what was required. The United Nations could not enforce the contract,” this source said.

The October 1 memo goes on to say that China, Russia, and France blocked American and British efforts to properly audit the program.

“As the program developed, it became apparent the French, Chinese, and Russians had much to gain from maintaining the status quo,” the memo says. “Their business made billions of dollars through their involvement with the Hussein regime and (oil for food program). Moreover, many of those business interests have been tied to senior officials in those and other governments.”

Some of those businesses and individuals were listed in a document published last January by the Iraqi al-Mada newspaper. Sources on the Senate committee investigating the oil-for-food program say that the al-Mada list has not yet been verified but provided a list of leads for investigators. The committee’s memo also says that Iraq’s embassies in Russia, Switzerland, Turkey, and Vietnam received $61 million in kickbacks from oil companies involved in the program.